Checks in a 21st Century digital world

By Glenn Wheeler, president, Viewpointe Clearing, Settlement & Association Services, Viewpointe

Is the check dead? You might hear a near-unanimous “yes” to that question; or as others might say more accurately, check usage is simply on a long decline. While check usage has been dwindling in recent years, to paraphrase Mark Twain, the reports of its death are greatly exaggerated. A recent study shows a sizeable segment of the market still writes checks.

As The 2010 Federal Reserve Payments Study, which looks at noncash payments in the U.S. from 2006 through 2009, indicates electronic payments are quickly outstripping check payments; yet checks have remained a significant payment instrument – to the tune of $31.6 trillion in value paid in 2009. While businesses far outweigh consumers in the total dollar value of the checks paid, consumers overall continue to write more checks, according to the findings. And, the study found that while the number of checks written overall has declined more than 7 percent from 2006 to 2009, the volume of consumer-to-consumer check payments has actually grown in that same time period, from 2.2 billion to 2.4 billion.

Where is the consumer-to-consumer check-writing trend heading? Despite its overall decline, there are those who continue to see the value in this traditional payment method. A January New York Times story, Social Security and Welfare Benefits Going Paperless, about the U.S. government’s decision to pay benefits electronically, chronicled how the elderly have continued to opt to receive old-reliable checks versus the government’s proposed electronic deposit of social security payments.

While this one segment of the population alone will not keep checks going indefinitely, technology might encourage some of the smartphone-wielding segment of the population to continue circulating them. According to a recent American Banker article, For Mobile Deposit, Banks Choose Speed-to-Market Over Simplicity, banks are rushing ahead with mobile check deposit technology at the behest of their customers who are using the technology to deposit checks without having to step foot in a bank.

As electronic payments technology continues to evolve – from mobile payment apps to “tap-and-pay” payments using near field communications (NFC), financial institutions and their customers can easily move into a new payments world. Embracing the budding technology will, no doubt, bring new challenges, but with ease of use and the promise of potential growth to the financial institution’s bottom line it could be a worthwhile investment.

Even in our digital age, the old-fashioned check may still stand up as a viable complement to the technologically advanced payment methods.

What do you think?

Data: Lost or Misplaced?

By Rich Walsh

In taking a look at the Kroll Ontrack “Global Data Loss Causes” survey, I found it interesting that 90 percent of responders have lost data, and 18 percent did not know how the data went missing. Mind you, these losses could be attributed to such occurrences as data that has been corrupted by a virus or just human error – files being misfiled or accidentally deleted. But, I immediately thought, “Perhaps it wasn’t lost; it just couldn’t be found.”

Having written and spoken about data storage for years, one theme has remained constant: the amount of data that corporations must manage is growing and shows no signs of stopping. Keeping track of this mass of data is a daunting challenge for many companies.

I often hear from IT executives that they are frustrated by the multitude of archiving systems at their organizations as more and more repositories are installed to meet data growth. Misplacing data becomes very plausible, and even typical, in this type of environment.

Losing data is never a good thing and when it happens, whether in a household or at a major corporation, it can create some headaches – to put it mildly. In the current environment, losing data is simply not an option as new regulations are sure to put more demands on data recovery. The consequences for missing data can be severe; you only need to read the mortgage-foreclosure headlines to get a sense of this.

Storage professionals may be feeling pressure from IT executives to fix the problem while managing costs. Data management should not be an obstacle to a corporation’s primary business objective. Now is the ideal time to address this issue because there is no apparent end in sight for the onslaught of data.

How is your company handling the barrage?

Rich Walsh is President, Document Archive & Repository Services at Viewpointe. He has more than 25 years of operational information technology experience.

Online Storage and Privacy Laws

Posted by Mark Brousseau

If you store sensitive files on your personal computer which law enforcement authorities wish to examine, they generally cannot do so without first obtaining a search warrant based upon probable cause. But what if you store personal information online—say, in your Gmail account, or on Dropbox? What if you’re a business owner who uses Salesforce CRM or Windows Azure? How secure is your data from unwarranted governmental access?

Both the U.S. Senate and the House of Representatives are investigating these crucial questions in two separate hearings this week. Congress hasn’t overhauled the privacy laws governing law enforcement access to information stored with remote service providers since 1986. The Electronic Communications Privacy Act (ECPA), the key federal law governing electronic privacy, has grown increasingly out of touch with reality as technology has evolved and Americans have grown increasingly reliant on cloud services like webmail and social networking. As a result, government can currently compel service providers to disclose the contents of certain types of information stored in the cloud without first obtaining a search warrant or any other court order requiring the scrutiny of a judge.

Against this backdrop, the Competitive Enterprise Institute has joined with The Progress & Freedom Foundation, Americans for Tax Reform, Citizens Against Government Waste, and the Center for Financial Privacy and Human Rights in submitting a written statement to the U.S. Senate and House Judiciary Committees urging Congress to reform U.S. electronic privacy laws to better reflect users’ privacy expectations in the information age. The groups also belong to the Digital Due Process coalition, a broad array of public interest organizations, businesses, advocacy groups, and scholars who are working to strengthen U.S. privacy laws while also preserving the building blocks of law enforcement investigations.

“The success of cloud computing—and its benefits for the U.S. economy—depends largely on updating the outdated federal statutory regime that currently governs electronic communications privacy,” the statement argues. “If Congress wants to ensure Americans enjoy the full benefits of the cloud computing revolution, it should simply reform ECPA in accordance with the principles proposed by the Digital Due Process coalition.”

What do you think?